Click above to listen to an interview podcast with Glen Polycn.
The tax benefits of network marketing are hugely undersold. If more people understood the tax benefits of a home based business more people would get involved for the tax advantages alone.
Todays post was written by a guest, Glen E. Polcyn, who is a Certified Financial Planner and Vemma Elite member. Glen has just written a book called How To Deduct Almost Everything!… And Have Uncle Sam Pay You! which is a great little read for those who want Uncle Sam to pay for your fun.
Did you know that you can deduct the majority of your hobby expenses such as cycling, golf, bowling, etc. as legitimate deductible business expenses?
Here’s how. Whatever your hobby is, as long as you are conducting it with the intent of promoting your Vemma business, your expenses are deductible!
Using Golf as an example, let’s say that you spend the following:
- Golf shirt with embroidered Verve emblem (advertising) $75
- Embroidered athletic socks (advertising) $20
- Golf shoes adorned with Verve Logo (advertising) $200
- Golf Clubs wrapped with Vemma, Verve or Thirst logos (advertising) $800
- Golf bag with Verve logo em-blazed on the side (advertising) $200
- Thirst bottle with Thirst inside (advertising) $20
- Product samples on the course (promotion) $100
- Green fees to prospect and promote Vemma products $100
Add it all up <$1,515.00> in business expense deductions x 30% average combined federal and state tax brackets = $454.50 in tax savings. This is a direct reduction or actual savings in your golf expenses!
Now if your golf country club membership is $5,000.00 per year, that would be another $1,500.00 saved in taxes. ($5,000 x 30%). How would you like to receive a 30% discount on your annual country club membership fees?
NOTE: Be careful not to get tripped up on the 50% allowable entertainment expense deduction. If you are purchasing green fees, food or beverages, etc. for a prospect, the IRS classifies this as an entertainment expense and you are only allowed to deduct 50% of your prospects expenses. And you must discuss Vemma, the product or opportunity, before, during or after your outing.
For an explanation of how this works see pages 9-11 in my book, “How To Deduct Almost Everything.!”
Network marketing is really the perfect home based business, especially from a tax standpoint. (See pages 6 -7.) It is your independent contractor status that makes all of these business expense deductions possible. You receive your income via a 1099 VS an employee who receives a W-2. (See page 42 for an explanation.)
As always, be sure that you review this tax saving strategy with your competent tax preparer.
How do I know if my tax preparer knows this? Pages 37 – 40 will answer this!
And remember, as long as you are conducting your business in a businesslike manner, Uncle Sam will pay you to build your business!
How? Through the tax savings!
Glen E. Polcyn, CFP – www.howtodeductalmosteverything.com
